Medical debt is a burden on American families. People regularly make tough decisions about whether to pay down their debt or buy groceries, necessary medications, and cover household bills.
Sometimes, the threats from medical debt collectors become so intense, injured people forgo eating and skip taking their medicine so they can get the collectors to leave them alone for a little while.
This is bad, but the situation is far worse than anyone previously realized.
Over the last five years, estimates on the total amount of medical debt in the U.S. have nearly doubled. Right now, Americans are $140 billion in debt due to necessary medical treatment, according to new research out of Stanford University. For those who owe, the average medical debt is $2,424 per person.
In 2016, the last time the national medical debt was calculated, families were being hounded by collectors for $81 billion in unpaid hospital and care facility bills.
Meanwhile, health care insurance providers continue to earn billions of dollars in profits each year. In just the first quarter of 2021, for example, UnitedHealth Group reported $4.9 billion in profits, while CVS Health reported gains of $2.2 billion.
Car insurance and medical debt
Most people struggling with medical debt have insurance or were injured in a car accident caused by someone else who has insurance.
Washington State, for example, requires drivers to purchase car insurance worth $25,000 in bodily injury and $10,000 in property damage. Car accidents on Aurora Avenue and North Street in Seattle regularly draw on these policies.
When insurance companies shortchange people injured in accidents, the victims have two choices — accept it or fight back.
If you accept a lowball settlement offer from an insurance company, you could wind up paying for some expensive medical treatments out of your own pocket down the road.
If you fight back, a personal injury lawyer can aggressively advocate for your best interests in settlement negotiations, or, if necessary, leverage a civil lawsuit in an effort to get you a better compensation package.
Most insurance companies would rather settle with a lawyer than go through an expensive trial where juries often sympathize with the victim. In fact, about 95% of personal injury lawsuits are settled before they go to trial.
Still, that doesn’t mean getting the compensation you need and deserve after suffering an injury in an accident will be easy. Remember, the insurance company has a vested interest in paying you as little money as possible, and you can trust that they will do everything in their power to achieve that goal.
More medical debt still
The U.S. medical debt situation is likely far worse than even what the Stanford study estimates.
The $140 billion figure does not consider medical debt put on credit cards. That means if someone needs to pay a hospital bill with a credit card then defaults on the payments, the debt becomes credit-related, not medical.
About one-third of all credit card holders use their cards to pay for healthcare, and Americans are in debt to credit companies for about $807 billion.
After a bad accident, many full-coverage paying, long-term insurance policy owners believe that they have all the protection they need. They see the right doctors and get the medical attention they need.
Then when it’s time for insurance providers to pay the bill, some policyholders are shocked at how little coverage they really have. Too many people also get the rug pulled out from under them by insurance providers who retroactively deny services.
Injured accident victims often have to hire a lawyer to negotiate with the insurance companies and/or file a civil lawsuit to get them enough money to cover medical expenses and related costs.
Who owes the most?
Medical debt is not evenly distributed throughout the U.S., according to research authors. It is concentrated among the people who can least afford it — low-income earners.
Poor people living in Southern states that do not participate in the federal Affordable Care Act’s Medicaid expansion program carry a lot of the nation’s medical debt, the report says.
Here are some of the study’s other key findings:
- Washington is among the U.S. states with the least amount of medical debt
- The Northeast has the lowest debt burden. About 11% of residents are in arrears and have the smallest unpaid bills out of anyone in the nation. In the South, almost 24% of residents have past-due medical bills
- People dealing with collection agencies owe more money to hospitals and care facilities than all of their other debts combined, including credit cards, phone bills, and utilities
- Nationwide, people owe a mean medical debt of around $430
- In the South, the mean medical debt is $616
- The Northeast’s mean medical debt is almost $170
Don’t leave money on the table when you’ve been injured
If you were injured in an accident, it is important now more than ever to understand the full cost of your injuries. That means understanding the financial impact of your injury now and in the future. In most cases, if you leave money on the negotiating table you cannot go back for more if your injuries flare up or you require additional medical treatment.
Insurance adjusters want you to believe that you can bounce back to normal health with a few thousand dollars, but the average overnight hospital stay is more than $11,000. You need the maximum payout on your claim to cover your damages (accident-related expenses), which may include:
- Past, current, and future medical treatment
- Lost wages
- Emergency medical services
- Physical rehabilitation
- Diminished earning potential
- Multiple operations
Nelson Langer Engle, PLLC fights for accident victims in Washington State. We always go for maximum compensation because we understand what’s at stake for you and your loved ones.
If you or a loved one was recently injured in an accident due to someone else’s negligence in the Seattle or Tacoma area, contact our law firm today for a free case consultation with no obligations. We can help you understand how the law applies to your specific case and the true cost of your injury.
Our law firm also offers legal representation to accident victims on a contingency fee basis. That means there is no upfront money to hire us, and our fees are calculated into your final settlement or verdict (which is paid for by the insurance companies).
We’re ready to fight for the compensation you deserve, and we’ve got the case results to prove it. For example, we recently obtained a $1 million settlement to cover the lifetime care of a client who was hit by a commercial van.
See what our law firm can do for you. Call or email us today to schedule a free case review.